Homeluxury bag → The strong rise in fertilizers impacted the tax pressure of the countryside

The strong rise in fertilizers impacted the tax pressure of the countryside

The Agricultural Foundation for the Development of Argentina (FADA) released its quarterly measurement of how much of the agricultural income remains in the hands of the State.

September FADA Index

The number grew 1.6 percentage points compared to the previous quarter and shows that for every $100 of producer income (income minus costs), $63.40 remain for different levels of government. “Why did it go up? Taxes and more taxes. The majority (68%) are non-participating nationals, that is, they are resources that are being taken away from the cities of the interior, mainly due to Export Duties”, explains David Miazzo, Chief Economist of FADA.

The FADA Index offers different measurements: the average of crops weighted at the national level marked 63.4%, but it also shows how it occurs in different grains. In the case of soybeans it is 67.5%, corn 55.5%, wheat 59.6% and sunflower 49.8%.

La fuerte suba de los fertilizantes impactó sobre la presión impositiva del campo

Regarding the provincial indices, Córdoba registers 63.1%, Buenos Aires 61.4%, Santa Fe 61.1%, La Pampa 62.9%, Entre Ríos 66.0% and San Luis 62.1%.

Why did the tax pressure on the countryside increase?

The main reason why the index rose is that input costs increased. Within inputs, fertilizers have presented annual increases of up to 50%. But the ones that rose the most were phytosanitary products, some have shown annual price increases greater than 50% and even 100%.

“Why does a rise in costs increase the participation of the State? Because higher costs reduce income, but taxes are not reduced in the same proportion. This happens because the main tax is the export duties that are calculated on the price of the products and not on the profits generated by the production”, explains Miazzo.

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